UBS said though Saks sales were recovering faster than expected, slowing margins will be a negative catalyst. The company reported fourth quarter sales of $955 million, up 17 percent from the year ago quarter.Given the retailer higher sales base and a lower share count assuming a $250 million buyback through 2008, UBS said it raised its fiscal 2009 earnings estimate for Saks to 57 cents a share from its earlier view of 45 cents.Saks gross margin for the fourth quarter improved to 37.9 percent of sales from 33.6 percent a year earlier but the brokerage said it did little more than recover off already low levels.UBS said the operator of Saks Fifth Avenue stores cannot close the margin gap with its peers due to its product mix and less attractive real estate. (Reporting by Sonya Balasubramanyam in Bangalore)..

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